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Fraudulent Practices by Two Medical Laboratories Lead to Large Settlement Fines

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Four whistleblowers working for two U.S. medical testing labs, Health Diagnostics Lab Inc. (HDL) and Singulex Inc., brought attention to fraudulent company practices.  Both companies were charged with violating the False Claims Act by bribing physicians to refer patients to get testing done at the labs and for billing federal healthcare programs for unnecessary testing; the physicians participating in this fraud were paid $10-17 for each patient referred for testing.  The alleged fraudulent actions began at HDL in November 2008 and at Singulex in January 2010.  HDL agreed to pay $47 million and Singulex agreed to pay $1.5 million to settle the lawsuits, although neither company admitted liability.  False Claims Act cases in general have generated more than $23.9 billion in settlement recoveries, with more than have of that amount related to fraud against federal health care programs.

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